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Bubble Trouble

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Bubble trouble

By Erik Britton | 1 September 2014

Government policies have put a rocket under over-inflated house prices while social housing’s share of the total stock has steadily fallen. So how do you rebalance the market?

http://www.publicfinance.co.uk/features/2014/08/bubble-trouble/

See article. I don't know the background of the writer or Fathom Consulting. I have read it once but I am struggling with the solutions!

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The trouble is bubble prices are seen as "normal" correct the prices and you destroy "wealth" and you risk the solvency of the banking system. No politician is going to be insane enough to reveal everyone is totally naked. The game is to ensure everyone remains convinced they have their clothes on.

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The trouble is bubble prices are seen as "normal" correct the prices and you destroy "wealth" and you risk the solvency of the banking system. No politician is going to be insane enough to reveal everyone is totally naked. The game is to ensure everyone remains convinced they have their clothes on.

Nicely put.

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The trouble is bubble prices are seen as "normal" correct the prices and you destroy "wealth" and you risk the solvency of the banking system. No politician is going to be insane enough to reveal everyone is totally naked. The game is to ensure everyone remains convinced they have their clothes on.

It will happen.

Mainly because most people under 35 are naked now.

I think the scales will tip heavily in their favour within the next few decades. From that point on the vast majority of the electorate benefits from lower prices.

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I think the scales will tip heavily in their favour within the next few decades. From that point on the vast majority of the electorate benefits from lower prices.

Well that's just great, I'll be on the losing side again by then. :(

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It will happen.

Mainly because most people under 35 are naked now.

I think the scales will tip heavily in their favour within the next few decades. From that point on the vast majority of the electorate benefits from lower prices.

Yes and they are all taking pictures of themselves naked.

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From the OP's link


Since then, the UK has leapt from the bottom to the top of the league table of advanced economies in terms of its growth rates; house prices have accelerated into double-digits; bank lending has turned positive (at least to households); and inflation has slowed.

It just demonstrates that the way they measure "growth rate" is meaningless in terms of real growth.

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From the OP's link


It is a truth universally acknowledged that the UK suffers from a chronic shortage of houses. All political parties agree, so does the Bank of England and so (unsurprisingly) do the housebuilders.

Measuring "truth" as spoken by political parties, the BoE and housebuilders :o

(the article does go on to say it's not true)

Edited by billybong

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  • 406 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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